China is expected to maintain its annual economic growth target at around 5 percent for 2025, the same as last year's goal, in a bid to shore up market expectations in the face of tepid domestic demand and rising trade protectionism, analysts and executives said.
The world's second-largest economy has vowed to enhance countercyclical adjustments, including a more proactive fiscal policy and a moderately loose monetary policy, and provide a strong underpinning for achieving its annual goals, they added.
Though China's GDP target will only be officially disclosed during the National People's Congress session in March, the anticipation for the unchanged growth target comes as China's major economic hubs — like Beijing and Shanghai as well as the provinces of Guangdong and Zhejiang — have announced GDP growth goals in the vicinity of 5 percent for the year.
▲ Containers are loaded onto a vessel in Qingdao Port, Shandong province. Yu Fangping/For China Daily
Aside from Qinghai's relatively lower target of around 4.5 percent, most other provincial-level regions have also set their growth goals at around 5 percent or slightly above 5 percent.
Notably, the Xizang autonomous region has set the most ambitious growth objective, targeting over 7 percent with an aim to reach 8 percent. Chongqing, along with the provinces of Hainan and Hubei as well as the Xinjiang Uygur autonomous region and the Inner Mongolia autonomous region, have set their growth goals at around 6 percent for this year.
"The country is expected to aim for a GDP expansion of around 5 percent, as China is committed to achieving the goal of doubling per capita GDP by 2035, which requires an implied growth rate of no less than 4.6 percent," said Zhang Ming, deputy director of the Institute of Finance and Banking, which is part of the Chinese Academy of Social Sciences.
The growth target will also help boost confidence and expectations in the current context of relatively subdued sentiment and provides a framework for policymakers to coordinate resources, Zhang said.
Moreover, based on data from 2020 to 2024, every 1 percentage point increase in GDP has the potential to create around 2.61 million new urban jobs. A growth rate of around 5 percent could generate over 13 million new jobs, which would significantly alleviate employment pressure, said China Minsheng Bank.
Through ramping up the intensity of countercyclical adjustments, China can harness its underlying growth potential to meet its 5 percent GDP growth target for 2025, even in the face of potential economic headwinds, said Wen Bin, chief economist at China Minsheng Bank.
"With external demand likely to face trade barriers tipped by certain economies, China will need to direct its efforts toward unlocking the potential of domestic consumption as the main engine of economic growth," Wen said.
China's consumer goods trade-in programs, which have driven a more than 1 percentage point increase in the annual growth of the country's total retail sales last year, are set to cover a broader range of consumer goods and offer even more attractive incentives in 2025.
"China is likely to double the funding for its consumer goods trade-in initiatives this year to 300 billion yuan ($41 billion)," said Wang Qing, chief macroeconomic analyst at Golden Credit Rating International.
This significant increase in funding is expected to drive a substantial boost in consumption, with Wang forecasting an additional 750 billion yuan in spending in 2025, equivalent to a 1.5 percentage point acceleration in the growth rate of the total retail sales of consumer goods.
China's economic growth is poised to outshine the global average this year, underpinned by the dynamism of its innovation-driven private sector and the rapid expansion of future-oriented industries, said Ernesto Torres Cantu, head of international at Citi.
